To augment its growth, Bank of Baroda is also planning to hire about 20,000 people in the next four years. The only short-term worry is that its chairman will retire by the end of this month. However, if the new chairman increases provisioning to clean up the balance sheet further (as happened in the case of the State Bank of India), investors should use the opportunity to buy the bank's stocks.

Oriental Bank of Commerce

"The Oriental Bank of Commerce has been witnessing a distinct improvement in its quality of earnings and appears to offer better value for money," says Krishnan. Though the bank's decision to shed nearly Rs 5,000 crore bulk deposits will result in a slightly lower business growth in the second quarter compared with the 16% growth that it achieved in the first quarter, it will help the bank to improve its net interest margin (NIM) on a quarter-over-quarter basis.

Another factor that will help the bank to maintain its earnings growth is the improvement in its asset quality. The slippage in the second quarter is likely to be only around Rs 500 crore compared with Rs 700 crore in the first quarter.